Chevron Fail To Overturn $18 Billion Lawsuit For Environmental Damage

January 3, 2012Investingby EW News Desk Team


An Ecuadorian appeals court has rejected an attempt by energy giant Chevron Corp to overturn a February 2011 ruling that charged the company $18 billion for spilling chemicals in the Amazon Basin more than 20 years ago.

"We ratify the ruling of February 14 2011 in all its parts, including the sentence for moral reparation," stated the court in the city of Lago Agrio in its ruling, as cited by Reuters.

The California-based energy company appealed against the February ruling on the grounds that that it was not responsible for chemical-laden wastewater dumped in jungle land from 1964 to 1992 by Texaco, which Chevron acquired in 2001.

In an email statement obtained by Bloomberg after the hearing, the energy giant lambasted the Ecuadorian appeals court’s decision, describing it as “another glaring example of the politicization and corruption of Ecuador’s judiciary that has plagued this fraudulent case from the start.”

The company “does not believe that the Ecuador ruling is enforceable in any court that observes the rule of law,” and has vowed to continue to seek recourse in other courts outside Ecuador.

By the time of last year's judgment, the case had been making its way through US and Ecuadorean courtrooms for more than 17 years.

The suit was originally filed in a New York federal court in 1993 against Texaco, but was dismissed three years later after the oil company argued at the time that Ecuador was the proper venue to hear the case.

According to Chevron, Texaco had spent more than $40 million cleaning up the area during the 1990s, and had also previously signed an agreement with Ecuador in 1998 absolving it of any further responsibility.

But the 30,000 Ecuadorians, who were represented in the lawsuit, chose to pursue the case for environmental contamination and illnesses that had allegedly resulted from Texaco's operation of an oil consortium in the Amazon.

The decision by an independent appellate court is yet further confirmation of Chevron’s extraordinary greed and criminal misconduct in Ecuador,” said Karen Hinton, a spokeswoman for lawyers representing the Ecuador residents.

Ecuador’s President Rafael Correa added that he was “very content” with the ruling, in an interview with public radio station Radio Publica, and described the dispute as a “David and Goliath” battle, with justice being prevailed in the end.

"I think justice has been done," he said after the decision was announced, as cited by the BBC. "The harm that Chevron caused to the Amazon cannot be denied.” 

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